Gold prices rebounded sharply on Tuesday, as trade concerns and Trump tweets roiled the capital markets. European PPI accelerated more than expected which could push the ECB into action more quickly than expected paving the way for higher gold prices. Gold prices surged generating an outside day, which is a higher high, a lower low and a higher close which is generally considered a reversal pattern pointing to higher prices. Support is seen near the June lows at 1,237. Resistance is seen near the 10-day moving average at 1,257. Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal.
Trump said he hopes the WTO changes its ways
Trump said he hopes the WTO changes its ways and if they don’t treat us properly, we will be doing something. He plans to be meeting with the EU about trade soon as well. He just spoke with the president-elect of Mexico about border security, trade, NAFTA and possibly a separate trade agreement. Trump thinks the president-elect will help with the border. He is also continuing to meet over the Supreme Court candidates and expects to make a decision in the next few days.
U.S. chain store sales rose
U.S. chain store sales rose 0.3% in the week ended June 30, according to The Retail Economist data, after jumping 3.0% in the prior week. The 12-month pace remained firm and accelerated slightly to a 3.6% year over year clip versus 3.4% year over year previously. Dollar stores, traditional grocery, and online-only retailers have been the consistent leaders in recent weeks. On the other hand, department stores and wholesale clubs have struggled. With 98% of retailers reporting, sales are up 3.0% year over year for the first fiscal quarter of 2018, the best since the 3.4% year over year rate in the first fiscal quarter of 2012.
Eurozone PPI inflation accelerated to 3.0% year over year in May, from 1.9% year over year in the previous month. Prices were up 0.8% m/m, after stagnating in April, as energy prices jumped 2.6% m/m higher